The Court of Appeal for Ontario recently released a decision clarifying the appropriate standards of review applicable on appeal from a decision of the Mining and Lands Commissioner (the “Commissioner”) reviewing a decision of a Conservation Authority pursuant to the Conservation Authorities Act, R.S.O. 1990, c. C.27 (“CAA”).

In Gilmor v. Nottawasaga Valley Conservation Authority, 2017 ONCA 414, released May 23, 2017, the Court of Appeal reversed the Divisional Court’s judgment (2015 ONSC 5327 (Div. Ct.)) overturning the Commissioner’s decision not to approve one family’s proposal to build a home on property they had purchased for that purpose. The Court of Appeal’s decision not only clarifies the standards of review applicable to the Commissioner’s decisions in relation to the CAA, but it also has significant implications for landowner rights and proposed projects or developments on or near conservation lands.

BACKGROUND

Alex and Tania Gilmor bought land in a developed area and, in 2009, began building a home on that land. Unfortunately for the Gilmors, developing their dream home wasn’t a simple matter of construction and their decision to build spawned almost a decade of litigation.

The complicating factor for the Gilmors is that part of their lot is situated on a floodplain subject to the control of the Nottawasaga Valley Conservation Authority ("NVCA") pursuant to the CAA, as “hazardous land” which “could be unsafe for development”. As a result, the Gilmors’ property was subject to s. 28 of the CAA and its regulations. Section 28 states:

28(1)(c) prohibiting, regulating or requiring the permission of the authority for development if, in the opinion of the authority, the control of flooding, erosion, dynamic beaches or pollution or the conservation of land may be affected by the development.

28(3) A regulation made under clause (1) (b) or (c) may provide for permission to be granted subject to conditions and for the cancellation of the permission if conditions are not met.

Pursuant to s. 28(3), NVCA passed O. Reg. 172/06, Nottawasaga Valley Conservation Authority: Regulation of Development, Interference with Wetlands and Alterations to Shorelines and Watercourses, in compliance with O. Reg. 97/04 and with Ministerial approval. Sections 2 and 3 of O. Reg. 172/06 regulate development on certain areas within the jurisdiction of the Authority:

2. (1) Subject to section 3, no person shall undertake development or permit another person to undertake development in or on the areas within the jurisdiction of the Authority that are, …

(b) river or stream valleys that have depressional features associated with a river or stream, whether or not they contain a watercourse…

(c) hazardous lands

…

3. (1) The Authority may grant permission for development in or on the areas described in subsection 2(1) if, in its opinion, the control of flooding, erosion, dynamic beaches, pollution or the conservation of land will not be affected by the development.

Accordingly, on realizing the home they were building was in the area of “hazardous lands” (i.e. within a floodplain) within the jurisdiction of NVCA, the Gilmors were required to and did apply for permission to proceed with their development.

The Gilmor house itself was not on floodplain. Rather, only part of the Gilmor’s lot behind the house sat along the fringe of the floodplain. Storm analysis showed that part of the Gilmor property was at risk of relatively shallow flooding over the Gilmors’ long driveway in the event of a “Timmins” storm (a rare but severe regional storm) which would have required wading to traverse.

The Conservation Authority denied the Gilmors application for permission to build in 2011.1 On appeal to the Mining and Lands Commissioner by way of s. 28(15) of the CAA, the Commissioner conducted a hearing de novo in 2013. On July 31, 2014, the Commissioner released lengthy reasons and upheld NVCA’s decision denying the Gilmors’ application for permission to build their home. The Commissioner concluded at p. 57:

Based on the evidence and the reasons outlined, the tribunal does not find the application to be appropriate or justified especially from a safety point of view and also from the need to maintain the natural floodway. The application cannot be considered unique from an environmental standpoint. The tribunal finds that the PPS will take precedence along with the mandate of the Conservation Authorities Act and the subsequent regulation. Therefore, the tribunal will order that this appeal be dismissed.2

The Commissioner made five key findings: (1) the NVCA Planning and Regulation Guidelines, the NVCA Development Review Guidelines, the Provincial Policy Statement 2005,3 and the Ministry of Natural Resources Technical Guide were relevant considerations; (2) the burden was on the Gilmors to convince the Commissioner to exercise her discretion to permit the proposed development despite the prima facie prohibition in s. 2(1) of O. Reg. 172/06; (3) the applicable policies and guidelines were reasonable and appropriate in order to prevent loss of life and property due to flooding; (4) the proposed development was not suitable for human habitation due especially to safety concerns, but also to issues surrounding natural hazards and natural heritage; and (5) permitting the Gilmors’ development would set a precedent that might encourage others to propose development in floodplains or floodways.4

The Gilmors then exercised their right of appeal to the Divisional Court under s. 133 of the Mining Act.5 The Divisional Court was quite critical of NVCA’s conduct and decision as well as the Commissioner’s decision, ultimately setting aside the decision, considering the issues itself, and directing the approval of the Gilmors’ development by NVCA without conditions.

Importantly, the Divisional Court acknowledged that reasonableness is normally the standard of review applied to questions of law involving the interpretation of a tribunal’s home statute, but held that the correctness standard applied in this case for two reasons: (1) the question was a matter of general importance to the legal system that was beyond the Commissioner’s expertise, relying on the earlier Divisional Court decision in 437400 Canada Inc. v. Niagara Peninsula Conservation Authority;6 and (2) the Commissioner’s high degree of reliance on safety considerations “amounted to a positive assertion of jurisdiction to scrutinize applications on the basis of safety”, which overlapped with the jurisdiction of the municipal authority to administer the Building Code Act7 and the Planning Act.8

Applying the correctness standard of review, the Divisional Court held the Commissioner erred in her interpretation of the regulatory regime. Rather than establishing an exception to a general prohibition against development as the Commissioner found, the Divisional Court concluded:

Section 3 of O. Reg. 172/06 was instead a condition precedent in that “only developments that affect the control of flooding … may be prohibited, regulated or subject to a requirement for prior permission”;9

Safety concerns, while a relevant consideration, ought not to have been elevated to a stand-alone head of jurisdiction for the purpose of regulating flood control. It was an error in the Court’s view for NVCA to “create jurisdiction over a proposed development by reason of safety issues alone where flood control is not impacted” and the hazards are only speculative;10 and

The potential cumulative impact cautioned against by NVCA and the Commissioner was a “minor theoretical impact” that did not constitute an actual impact on flood control required to invoke NVCA’s jurisdiction.

The Divisional Court concluded that “safety was used as a pretext for applying a policy preference that would seek to impose a blanket ban on development in areas within a floodplain without regard to the particular circumstances of the actual land or of the proposed development.”11

THE STANDARD OF REVIEW ON APPEAL FROM THE MINING AND LAND COMMISSIONER

NVCA appealed to the Court of Appeal for Ontario, arguing, primarily, that the Divisional Court erred in applying a correctness standard of review when it ought to have proceeded under a reasonableness analysis. Had it done so, NVCA and two interveners argued, the Divisional Court would certainly have concluded the Commissioner’s decision was reasonable.

The Court of Appeal allowed NVCA’s appeal, set aside the Divisional Court’s order, and reinstated the Commissioner’s decision not to grant permission to the Gilmors’ proposed development. Writing for the Court, Justice Huscroft held that the Commissioner’s decision is subject to review on the reasonableness standard and, in this case the decision was reasonable.

Applying Dunsmuir v. New Brunswick,12 the Court of Appeal clarified that the presumptive application of the reasonableness standard which applies when a tribunal is interpreting its home statute or statutes closely related to its function is engaged by decisions of the Mining and Lands Commissioner under the CAA. As such, the Commissioner’s decisions under the CAA are entitled to deference from the courts. Justice Huscroft noted:

The institutional expertise of a tribunal performing duties under a particular statute does not depend on the tribunal’s constitution under that statute, nor is it diminished by a legislative decision to assign decision making authority to that tribunal over additional statutes, whether or not those statutes serve related purposes.13

Further, similar to the approach taken in the recent Court of Appeal decision 2274659 Ontario Inc. v. Canada Chrome Corporation,14 which dealt with a decision of the Commissioner under the Mining Act, Huscroft J.A. concluded the CAA is one of the Commissioner’s several “home acts”. Accordingly, the reasonableness standard presumptively applies to appeals from the Commissioner’s decision interpreting the CAA and its regulations.

The Court of Appeal went on to hold that the presumption of reasonableness was not rebutted by any of the narrow range of circumstances in which the correctness standard applies. Justice Huscroft rejected the Gilmors’ argument that the question before the Commissioner was either a “general question of law of central importance to the legal system and outside the Commissioners specialized area of expertise”, or a “question concerning the jurisdictional lines between two or more competing tribunals”.

On the first ground, the Court of Appeal held the questions raised had no impact beyond the specialized administrative regime in which they arose, nor were they beyond the Commissioner’s expertise. On the second ground, acknowledging the complexity of the regulatory regime governing land use and development in Ontario, the Court of Appeal declined to apply a correctness standard on that basis alone. Justice Huscroft warned:

Questions concerning jurisdictional lines between specialized tribunals must be approached carefully, lest the presumption of reasonableness review be rebutted too easily and a key rationale underlying the presumption – that some decisions are better made by specialized administrative tribunals than the courts – be subverted.15

Although the Building Code Act includes construction standards for building on floodplains, the Court held that authority to authorize such developments is found exclusively with CAA. Further, Huscroft J.A. concluded that while NVCA is required to act in a manner consistent with the PPS in exercising authority that affects a planning matter, when a Conservation Authority does so it does not usurp municipal authority. Ultimately, the Court of Appeal held that the Conservation Authority (and the Commissioner on appeal) are the only bodies with development approval authority under the CAA and its regulations and the presumption of the reasonableness standard could not be rebutted.16

Applying the deferential reasonableness standard, the Court of Appeal found both the Commissioner’s interpretation of ss. 2 and 3 of O. Reg. 172/06 and her exercise of discretion under s. 3 were reasonable.

IMPLICATIONS

Accordingly, the Commissioner’s decision was restored and the Gilmors’ long struggle to build their home suffered another defeat. This case is important to more than just the Gilmors, though, as it has broader implications for landowners’ rights across the province. The Court of Appeal’s decision clarifies the following:

A decision of the Mining and Land Commissioner on appeal from a development approval or denial under the Conservation Authorities Act will be reviewed on the reasonableness standard;

Sections 2 and 3 of O. Reg. 172/06, and by necessary extension the mandatory provisions in sections 3 and 4 of O. Reg. 97/04 applicable to all conservation authorities, create a general prohibition against development in the area of or on the enumerated environmentally significant areas, subject to the discretionary approval of the conservation authority;

The discretion of a conservation authority and the Commissioner to approve or deny permission to proceed with a proposed development will not be interfered with lightly; and

Safety to health and property as well as conservation of land are two important considerations in the regulatory regime governing developments on or near floodways and floodplains, which, in the Gilmors’ case, trumped their desire to build a home on their property.

In the wake of this decision, prospective landowners ought to carefully examine whether property they wish to purchase and develop is situate on or near environmentally significant areas such as floodplains – even the slightest overlap of lands with potential floodplains (as occurred on the Gilmor property) may inhibit development.

Landowners, too, must be conscious of the potential limitations on the development of their land and ensure to seek all necessary prior approvals. That said, this decision suggests that policy considerations including safety and conservation may win the day in the face of proposed development projects, no matter how small the risk to the land or how speculative the hazard to safety.

The content contained in these blogs is intended to provide information about the subject matter and is not intended as legal advice. If you would like further information or advice on any of the subjects discussed in a blog post, please contact the author.

1A detailed review of the evidence and submissions before NVCA and its reasons for decision can be found in the Divisional Court Reasons at paras.13-28.

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